(PDF) The Impact of Welfare Services on Employee Performance of Selected Deposit Money Banks in Lagos State, Nigeria.

Chapter One of The Impact of Welfare Services on Employee Performance of Selected Deposit Money Banks in Lagos State, Nigeria.

Abstract of The Impact of Welfare Services on Employee Performance of Selected Deposit Money Banks in Lagos State, Nigeria.

Employee performance is an essential requirement of an organization to maintain its efforts towards the realization of predesigned goals. Employee performance is a vital subset of most organizations which is necessary since an organization’s success is dependent upon the employee’s creativity and commitment. Studies revealed that organizations fail to inform employees of their rights in relation to fringe remunerations during their first schedules or elevation. Mismanagement, inequity and communication obstacles lead to dissatisfaction amongst employees, welfare programs provided by any organization to its workers have direct impact on the physical, health and mental efficiency alertness, morale and overall efficiency of the employees. The main objective examined the impact of welfare services on employee performance of selected deposit money banks in Lagos.

The study adopted cross sectional survey research design. Primary data was collected through the use of questionnaire. The population of the study comprised of 235 employees. 179 respondents constituted the sample size. The Cronbach’s alpha reliability coefficients of the constructs ranged from 0.721 to 0.874. Descriptive and inferential statistics were applied via statistical package for social sciences (SPSS).

Background to the Study

In the last few years, many organizations kept full competitive benefits in the worldwide marketing competition including the banking sector through the improvement of employee performance. Employee performance is an important criterion for organizational outcomes and success. Therefore, many organizations are improving in their welfare packages in order to increase employee performance for the benefit of the organization.

Employee performance is an essential requirement of an organization to maintain its efforts towards the realization of predesigned goals. Organizations should understand that a healthy and stress free employee is a major asset to the organization and should therefore provide welfare services and programs (Ankita, 2010). Positive employees’ behavior and their work attitudes are important for accomplishment of the goals and objectives of any organization (Beheshtifar, Nezhad & Moghadam, 2012). Employee performance could be characterized by financial or non-financial results of the employee which has direct link with the success of the organization (Anitha, 2014). Individual performance is determined by organizational policies, design features and practices of an organization (Anitha, 2014). It is noteworthy that the concept of employee performance is increasingly gaining motion into business organization context in that it explains the level and quality of employees in terms of product and services delivery in an organization. Employee performance is a strategic approach to the management of business administration as a quest for efficiency and effectiveness of employees in terms of production of goods and services.

Globally, in developed countries like United State, France, United Kingdom, Belgium, Germany and Italy, employee performance is a matter of concern that is being taken very importantly to such an extent that businesses around the world are been elevated due to the return of employees which emanates from the role they play on product and service delivery. In United Kingdom, the employer allows the new parents go on a leave for 52 weeks; as stated by the Glassdoor survey they are to be receiving pay for 39 weeks while on leave. In Iceland, 120 days off at 80 percent pay paternity leaves was proffered to dads so that they can spend time with their newborn children, also in addition to paternity leave, the new mothers receive diapers, bathing products, baby bed, the new mothers enjoy working half day until their child is two (Michael, 2016). In India, it has been reported that most organizations’ department is always been neglected; thus calling for the needs for sufficient budgetary allocations by the government so as to provide essential facilities and welfare services for effective organization (Ankita, 2010). In these countries, employee performance is a vital subset of most organizations which is necessary since an organization’s success is dependent upon the employee’s creativity and commitment. Even though employee performance seems to be a relative factor which depends on other factors, this performance can be self-determined if employees are well cared for in terms of the nature of welfare service being offered to them.

The role of welfare services on the performance of employees is a subject of great concern in Africa especially in countries like Ghana, Kenya, Egypt, Gambia and Senegal employee performance is an important issue for employers, managers, shareholders and investors, particularly those in service institution such as the banking sector. In Ghana, studies have shown that currently 25% of employees are not housed at all, contrary to Ghana’s conditions of service. Out of the 75% who reside in organization’s accommodation only half have decent accommodation. In Kenya, for example, some employees are not adequately taken care of in terms of accommodation, health service, transportation and so on, this can lead to the poor performance of the employees.

In Nigeria, employee performance is the most important factor in an organization irrespective of its nature and type. This is because the success or failure of an organization depends largely on the caliber and quality of its employees. Organizations should provide welfare programs in order to motivate and retain employees, to improve employees’ performance, health, social status and economic condition (Okafor & Daramola, 2018). Employee performance is note-worthy, therefore, that organizations with unskilled employees may not get the average expected return from such employees due to their level of professionalism in what they do. This makes employees performance very important to organizations in Nigeria. No organization, irrespective of size and resources can survive without competent and qualified personnel. Lack of inadequate welfare packages and other incentives leads to poor worker’s motivation which greatly affect their outcomes hence, there is need for employers to give staff welfare package and other incentives for the benefits of the employees, employers and the organization (Okereke & Daniel, 2010). Incidents of neglect of welfare services of employees in the country has been reported due to the absence of a comprehensive and sustainable welfare policy, inadequate and improper budgetary allocations by the government and corruption both in the budgeting and expenditure processes, making the performance of the Nigerian organization to remain sub-optimal as their welfare is not given due attention (Alemika, 2008).

Provision of employee welfare services in deposit money banks is critical for the efficiency of employees in any country. These services if inadequate, will negatively impact on the performance of employees. This impact of stress or exposure to traumatic incidents shows that there has been a growing concern about the potential risks posed by employees whose psychological well-being has been affected by their work thus the need to assess and support employees who have been involved in critical incidents through provisions of employee welfare services in ensuring that they are fit for service. However, provision of welfare facilities in India has been made obligatory especially the recreational facilities for employees to stem out the problem of lack of commitment on the part of the workers thereby improving their productivity which is possible with the satisfaction of labor (Manju & Mishra, 2007). A study conducted by Mugenda & Mugenda (2003) reveals that serious problems ranging from poor working conditions and lack of employee welfare services is a subject of great concern. Efforts by the government, private sector and other stakeholders to eliminate occupational accidents and injuries through sound health and safety has been very difficult due to various challenges facing the Occupational Health Standards scheme such as the management commitment and welfare services are poor in the developing countries (Morwabe, 2009).

In most cases, the objective is to render service(s) in pursuit of fulfillment for the organization in achieving its social obligations (Armstrong, 2013). The facilities are composed of buildings, infrastructure and support services (Nyamwamu, Atambo & Munene, 2012). A well-managed business organization normally considers the welfare of an average employee as the primary source of his or her productivity gain. These organizations consider employees rather than capital as the core foundation of the business and contributors to firm development. To ensure the achievement of firm goals, the organization creates an atmosphere of commitment and cooperation for its employees through policies that facilitate employee satisfaction. Different welfare programs provided by any organization to its workers have direct impact on the physical, health and mental efficiency alertness, morale and overall efficiency of the employees. Welfare benefits are a necessity in every organization today. Employees have to be kept motivated at all times through various measure and activities. The concept of welfare is necessarily dynamic, bearing a different interpretation from country to country, from time to time, and even in the same country, depending upon its value system, social institution, degree of industrialization and general level of social and economic development. Even within a country, its content may differ from region to region (Supriya, 2017).

Employees are essential to the means of production (Edralin, 2014); they deserve to be treated with respect and given proper welfare packages and incentives (Barber, 2008). Welfare services improve their sense of worth, boost their self- esteem, financial status and act as, a sort of motivation to drive them to have more passion for their job, which is expected to be pursued by employers who look beyond instant profit making as opposed to enduring sustainable business earning of profits in perpetuity (Logasakthi & Rajagopal, 2013). There have been a lot of concerted efforts at national and international levels to set standards with minimal government interference and free market forces that would serve as a framework to guide labor relations between employees and employers and thus confer on worker’s certain rights once there is an established contract of employment (Breaugh, 2011).

Statement of the Problem

It is relevant to mention that although the idea of welfare service has existed for more than half a century, there is still no agreement over its definition. Welfare service generally refers to business practices that are based on ethical values, compliance with legal regulations and respect for people and the environment. Armstrong (2004) states that employee welfare service rests mostly on the abstract ground of social responsibility on organizations for those who work for them. Herzberg (2009) believes those structures are cleanliness factors and as a result does not motivate the workers to perform.

Lack of welfare services and other incentives can lead to poor employee motivation which greatly affect their performance (Okafor, Linus, Gloria & Daramola, 2018). According to Mahia (2014), organizations fail to inform employees of their rights in relation to fringe remunerations during their first schedules or elevation. He opposes that mismanagement, inequity and communication obstacles lead to dissatisfaction amongst employees. Willis (2014), claimed that non-competitive compensation, high pressure, working conditions, dullness, poor management, disparity between employee and job, insufficient training, and organization practices contribute to employees’ dissatisfaction hence nonperformance. Lack of reward to result to employee turnover, lack of organizational support resulting to employee dissatisfaction and lack of training and development leading to low productivity of employee is another identified problem.

Many research has been done on welfare service and employee performance in Nigeria especially in oil and gas, manufacturing and telecommunication sector but few in banking sector (Folajin, Ibitoye & Dunsin, 2014). This is a strength for this study as there are sufficient evidences to prove that studies on welfare services and employee performance of deposit money banks in Lagos State are relatively few. This is the gap this study intends to fill, to explain how organizational support, reward, and training and development affect employee performance of deposit money banks. However, this study intends to examine the impact of welfare service on employee performance in deposit money banks in Lagos.

Objective of the Study

The general objective of this study was to examine the impact of welfare services on employee performance of selected deposit money banks in Lagos State, Nigeria.

The specific objectives were to;

i. examine the effect of organizational support on employee job satisfaction of selected deposit money banks in Lagos State, Nigeria.

ii. evaluate the effect of reward on employee retention of selected deposit money banks in Lagos State, Nigeria.

iii. determine the effect of training and development on employee productivity of selected deposit money banks in Lagos State, Nigeria.

Research Questions

How has organizational support affected employee job satisfaction of selected deposit money banks in Lagos State, Nigeria?

How has reward affected employee retention of selected deposit money banks in Lagos State, Nigeria?

What is the effect of training and development on employee productivity of selected deposit money banks in Lagos State, Nigeria?

Research Hypotheses

H₀1: Organizational support has no significant effect on employee job satisfaction of selected deposit money banks in Lagos State Nigeria.

H₀2: Reward has no significant effect on employee retention of selected deposit money banks in Lagos State Nigeria.

H₀3: Training and development have no significant effect on employee productivity of selected deposit money banks in Lagos State Nigeria.

Operationalization of Research Variables

Where: Y= Employee Performance (EP)

X= Welfare Services (WS)

Y= (y_1,y_2,y₃)

Where; y₁ = Employee Job Satisfaction

y₂ = Employee Retention

y₃= Employee Productivity

X= (x_1,x_2,x₃)

Where; x₁= Organizational Support

x₂= Rewards

x₃= Training and Development

Based on functional equation we have

y₁= f(x₁) …………………equation1

y₂= f(x₂) ………………… equation2

y₃= f(x₃) ………………… equation3

Regressionally, we have

y₁= α˳+ꞵ₁x₁+µᵢ …………… equation1

y₂= α˳+ꞵ₂x₂+µᵢ …………… equation2

y₃= α˳+ꞵ₃x₃+µᵢ ……………. equation3

The three models above will be tested to find out the effect of welfare services on employee performance.

Where;

α˳ = Constant

ꞵ₁ ꞵ₃= Coefficient of independent variable

µᵢ = Stochastic value or error terms

Scope of the Study

This study focused on the impact of welfare services on employee performance of selected deposit money banks in Lagos State. Two deposit money banks were focused on in Lagos State, Nigeria. These banks are Guaranty trust bank and UBA bank. The study focused on these selected banks companies because of recent researches and studies have shown that these are the most effective and efficient banks on the Nigeria Stock Exchange evaluation axis having high profit margins in 2018. The target population of the study would be employees from the selected banks. The population of employees in all the two banks in Lagos State is 325; Guaranty trust bank – 166 and UBA bank – 159. The researcher adopted Taro Yamane formula to determine the sample size. The research method adopted by the study is cross sectional survey research method. Also, the study adopted simple random sampling method in sampling the respondents and questionnaires was used in obtaining the data for the study. The data was analyzed using descriptive statistics (frequency distribution, mean and standard deviation) and simple linear regression analysis. The sub-variables used to measure the dependent and independent variables in the course of carrying out this study were represented below

Sub-independent Variables: Organizational Support, Rewards, Training and Development

Sub-dependent Variables: Employee Job Satisfaction, Employee Retention, Employee Productivity. The research was set to be executed from September 2019 to April 2020.

Significance of the Study

The study will be beneficial to Nigeria organizations by improving their performance. It would help the stakeholders of such organizations in widening their knowledge on how welfare services can lead to increased employee performance. The study will make deposit money banks and other non-financial organizations to appreciate the importance of welfare service in the provision of information necessary for employee retention, employees job satisfaction and employee productivity. Deposit money banks play a vital role in the economy is no longer in doubt because they are prime movers of economic life and occupy a significant place in the economy of every nation in their credit creation capacity. Finally, it will serve as a reference document for future researchers who may be interested to embark on study of this nature.

Operational Definition of Terms

Welfare: Welfare is a corporate attitude or commitment reflected in the expressed care for employees at all levels, underpinning their work and the environment in which it is performed. (Supriya, 2017).

Welfare Service: Welfare service is a comprehensive term which refers to the various services, benefits and facilities offered by the employer to employees with a purpose of enriching the life of employees and to keep them happy and contented (Supriya, 2017).

Employee: An employee is a person employed for series of business or transaction in an organization or a place of work (Barber, 2008).

Performance: Performance is the achievement and attainment of stated goals. The act of carrying out a duty or accomplishing something such as a task or action (Ankita, 2010).

Money Deposit Banks: Money deposit banks are commercial bank and an institution that provides service such as accepting deposits, providing loan and offering basic investment products (Armstrong, 2013).

Productivity: The state of being fertile or efficient or the rate at which goods or services are produced by a standard population of workers (Morwabe, 2009).

Organizational Performance: This is contribution an organization to achieve a specific organizational goal. It can also mean how effective an organization in carrying out its duties on employee job description to achieve a specific responsibility of the employees (Bohan, 2014).

Organization: Organization is a social unit of people that is structured and managed to meet a need or to pursue collective goals or organization is a systematic arrangement of people to accomplish the same specific purpose (Breaugh & Mann, 2014).

Training and Development: This is an organized procedure by which an individual (staff of an organization) systematically acquires skills, knowledge and attitude required to perform a given task or job adequately (Edralin, 2014).